Likelihood of Cut in Silver Content of Coins

Debasement of America's silver coinage looms as a regrettable but necessary measure to end a nationwide coin shortage and to protect the Treasury's silver stocks. Proposals for fundamental revision of the coinage system are expected from the Treasury Department early in 1965, when it sends to Congress recommendations based upon a year-long study of the so-called “quiet crisis” in silver.

A worldwide silver shortage, the pressure of rising silver prices, and an insatiable demand for silver coins have combined to make a change unavoidable. Many experts believe there are only two practical choices: a reduction in the silver content of United States coins, or substitution of a cheaper metal alloy for silver in some of the coins. The New York Journal of Commerce reported, Oct. 14, that the solution that seemed most likely was “a partial Treasury withdrawal from use of the metal [silver] for coinage.”

Managing the changeover was described as “a very tricky assignment,” because the Treasury would have to balance off as equitably as possible the interests of silver producers, silver users, retailers, banks, vending machine manufacturers, consumers, and producers of other metals. Even partial Treasury withdrawal from use of silver in coinage would present delicate political and psychological problems. The present silver coinage system has been in use with relatively minor changes since the first coinage act was adopted in 1792. The high silver content of the dime, quarter, half-dollar and silver dollar not only gives the coins high intrinsic value but also helps to support public confidence in paper money.